C-SPAN Battles ‘Dual Must Carry’

Posted November 14, 2003 at 6:06pm

For more than a decade, a furious battle has raged between American cable and broadcast operators over the future of the nation’s television. It has led to much animosity, more than a few lawsuits and one Supreme Court case.

And with the next round of this fight scheduled to be decided on by the end of the year by the Federal Communications Commission, C-SPAN is one cable network whose fate could be determined by the impending vote of the five FCC commissioners.

The current debate revolves around the idea of “dual must carry,” a proposal that would govern the cable industry’s role in the transition to digital television in America.

On one side are the broadcasters, who want cable providers to carry both their analog and digital signals during the transition to ensure that they build their digital audience while not disenfranchising their existing analog viewers.

On the other side are cable operators who argue that mandating “dual must carry” will result in fewer choices for their cable customers.

In recent weeks, FCC Chairman Michael Powell, as well as other members of the agency, have made it clear that they want to have a final decision on dual must carry before the end of the year. Although FCC spokeswoman Michelle Russo said she could not name an exact date the provision would be voted on, she did say that the five commissioners are hearing arguments on both sides and that “things are fluid right now.” She said that Powell has made it clear that “nothing is locked in … he said it would be nice to have [the provision] on the December agenda.”

In 2001, the FCC came to a tentative conclusion on dual must carry by stating that the provision “appears to burden cable operators’ First Amendment rights.” And although most industry watchers are confident that the 2001 decision will be upheld, four of the five commissioners have changed since that original vote.

“It’s kind of like reading tea leaves,” noted C-SPAN Corporate Vice President Bruce Collins. “Our judgment based on all the interviews and what everybody else thinks is that the commission will continue to oppose a dual-must-carry requirement on cable television operators — that’s our hope.”

If the proposal was passed, C-SPAN — a public service network that gets 98 percent of its funding from fees paid by cable operators — could face its biggest cutbacks in carriage since 1992.

At that time, a must-carry provision in the 1992 telecommunications law required cable operators to carry local broadcast stations, often at the expense of cable networks. One result was that C-SPAN often ended up on the chopping block instead of more lucrative channels such as movie or sports channels.

In the wake of the 1992 act, C-SPAN and C-SPAN2 were dropped entirely or shown only on a part-time basis in about 241 communities — or about 10 million households — according to Peter Kiley, director of affiliate relations for C-SPAN.

By the late 1990s, C-SPAN had bounced back from those cuts, and today the network is available in 98 percent of — or about 86 million — American homes. C-SPAN2 is in 72 million homes and C-SPAN3 is in 7 million homes, according to Kiley.

But C-SPAN officials insist those numbers may fall off if the FCC moves forward with the new version of the must-carry rule.

“We fear that if dual must carry would happen, it’s a train wreck for cable operators,” Kiley said. “In this case every broadcaster in the market gets another channel, so it’s a tremendous burden. … I fear we could be cut again.”

But the National Association of Broadcasters couldn’t disagree more.

“No one envisioned the digital television transition proceeding with the cable industry standing in its way, and that’s exactly what has happened,” said NAB Senior Vice President of Communications Dennis Wharton.

“That’s why we have encouraged the government to step in and set some rules and require carriage,” Wharton added. “If the goal is to make sure there’s a seamless transmission to digital television, you have to have the cable operators carrying local digital television broadcast channels.”

Many close observers, including Wharton, said it would not be a surprise if this issue once again ended up in court.

“The cable industry spent $40 million in 1992 to try to overturn the must-carry decision for analog TV, which they ended up losing,” said Wharton. “They’ve got so much money because of the exorbitant rate increases that they are passing on to their consumers that they can charge a couple extra pennies a month and take the case all the way to the Supreme Court.”

National Cable and Telecommunications Association spokesman Brian Dietz, whose group is backing C-SPAN, said that if dual-must-carry provisions are approved by the FCC, the NCTA “would cross that bridge when we come to it.”

Collins, however, was much more direct. “We’ll sue faster than you can say ‘dual must carry,’” he said.